University of Nebraska football isn’t the powerhouse it was during the Tom Osborne-led dynasty days from decades ago. But the Cornhusker State still manages to generate headlines and big numbers in October. Kind of like USDA.
USDA’s October report stunned the grain trade by hiking its estimate for the average 2026 U.S. corn yield to 181.2 bushels per acre, up 2.7 bpa from September and clashing with expectations for a small cut.
The yield boost in part reflects better-than-expected numbers in several western Corn Belt states, including Nebraska, where extreme heat and dryness ruled the summer. USDA nonetheless raised Nebraska’s estimated yield to 188 bpa, up 11 bpa from September, while South Dakota improved 6 bpa, bringing forecast yields there to 151 bpa.
The bearish numbers, part of USDA’s monthly Crop Production report released Oct. 9, sent the corn market into a tailspin, with December futures tumbling to a two-month low. Prices soon stabilized but a week later are still sharply down from September’s three-year high just under $5.50 per bushel.
Did delayed harvest skew numbers?
Farmers and traders are accustomed to USDA crop report curveballs this time of year, but the October numbers raised more than a few eyebrows. Like the August and September versions, the October Crop Production report is based on objective yield and farm operator surveys. However, the October report typically transitions into actual harvest results.
One twist this year is the heavy September rains that delayed fieldwork in much of the Midwest, which in theory limited available harvest data for the October report. Nebraska’s corn crop was only 15% harvested as of Oct. 4 (around the date USDA closed its survey) compared to its 24% five-year average for that date.
USDA also raised U.S. corn production about 234 million bushels to 16.03 billion bushels, which would be down 5.5% from 2025’s record harvest but still the second-biggest crop ever.
Despite the bearish yield and production numbers, USDA still delivered some reasons for longer-term price optimism. In its Supply and Demand update, also released Oct. 9, the agency raised estimated U.S. corn exports for the 2026-27 marketing year by 25 million bushels, to 3.3 billion bushels, and boosted ethanol industry use by 50 million bushels.
Strong demand combined with ongoing geopolitical turmoil are two reasons many analysts see limited price downside for corn and potential for a rally back above $5 in 2027. For now, December futures’ post-USDA low around $4.70 was still holding as of mid-October, though another push lower, perhaps to the $4.60 area, can’t be ruled out over the next several weeks.
‘A recipe for future volatility’
USDA curveballs are no doubt frustrating for farmers. For now, however, the numbers are the numbers. The best course may be to take a page from Coach Osborne’s power football playbook and power ahead with harvest and see what changes USDA may have in store in its next Crop Production report Nov. 10.
Also, USDA numbers are always moving targets this time of year, noted Brady Huck, principal and adviser at Empower Ag Trading.
“The USDA thinks the yields are going to be there,” Huck said. “But the balance sheets are going to be dynamic. There’s been a lot of change over the last couple of months, and changes will continue. These will not be the last numbers we will see for 2026-27. The USDA is not afraid to whipsaw these numbers back and forth, and not afraid to make big changes. That is a recipe for future volatility.”